Suppose an avocado farm has cost: C=0.004q+28q+ 1250, (where q is measured in bushels) and the rental cost of land is zero so the average cost curve includes only the farm's costs of labor, capital, materials, and energy-not land. This cost structure is representative of all firms in this industry. The market price of avocados is $31 per bushel. The firm's profit maximizing output is bushels of avocados. (Round your response to one decimal place.)

Suppose an avocado farm has cost: C=0.004q+28q+ 1250, (where q is measured in bushels) and the rental cost of land is zero so the average cost curve includes only the farm's costs of labor, capital, materials, and energy-not land. This cost structure is representative of all firms in this industry. The market price of avocados is $31 per bushel. The firm's profit maximizing output is bushels of avocados. (Round your response to one decimal place.)

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Cost Of Production

Section12.3: The Various Measures Of Cost

Problem 3QQ

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A Chinese high technology manufacturing firm has a production function of 9=12L0.20K0.80 (based on Zhang, et al., 2012). It faces prices of w = $2 and r= $8. What are its short-run average variable and marginal cost curves? Let K be fixed in the short run. The firm's short-run average variable cost curve, AVC, as a function of K and q is AVC = $ (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a superscript can be created with the ^ character.) The firm's marginal cost curve, MC, as a function of K and q is MC = $. (Properly format your expression using the tools in the palette.)
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The company AffordableStuff sells cell phones. The marginal cost for each cell phone is given by the equation C(x) = 0.01x² – 3x + 229. a is the number of cell phones manufactured and sold. The marginal revenue function is R(x) = 429 – 2.x. Both C(x) and R(x) are given in dollars. a) Where do these curves intersect? What do those intersection points mean? b) Find the area between the curves, using end points that make sense. Round to the nearest cent. c) What does the area under the curve mean in this case?
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